Mr Andre De Ruyter on corruption within Eskom

Meeting report

Chairperson: Colleagues, welcome to this meeting this morning which we had extended an invite to Mr Andre De Ruyter, the former CEO of Eskom, to appear before the Committee. I see that Mr De Ruyter is online. I know that this was a physical meeting and so you will all wonder why Hon Siweya is on the platform; there was an urgent matter she needed to deal with, so we made a special arrangement. Thank you for being here. What we are going to do is that I am going to make remarks and then we are going to Mr De Ruyter – we have received his statement – and then we will go to colleagues. We are going to go on a 20 minute rotation, colleagues. So Hon Hadebe is first off the bat, and then Hon van Minnen, Hon Mente, Hon Somyo and Hon Lees. And then we will go on a rotation. We are meeting with Mr De Ruyter from now until 12:00. And then we will break at 12:00 and then reconvene at 13:00 and make, perhaps, map the way forward after that. Mr De Ruyter, thank you very much. I did see you turn on your camera for proof of life that it is you. So on the 23rd of February the former Group Executive of Eskom, Mr De Ruyter’s interview with ENCA Journalist Annika Larsen was aired; serious allegations about corruption, criminal activity and malfeasance at Eskom were some of the allegations made. Some of the allegations made are new to SCOPA, while some were made public during the Zondo Commission State Capture Inquiry and the resultant State Cape Report and in other hearings of the Committee. Key to the allegations made in the interview is the decision-making by the national power utility, former board members and executives that resulted in the breach of the PFMA (Public Finance Management Act), which sets the prescripts with the effective financial management as well as optimum utilisation of public funds. Against this backdrop, Hon Bheki Hadebe, who is a Member of this Committee, penned a letter to us, requesting that Mr De Ruyter be invited to appear before the Committee to provide more information on the allegations made in the interview and clear any ambiguity, which is paramount for SCOPA in executing its parliamentary oversight function over how the public purse is being managed and spent by executives in accordance with the laws and budgets passed by Parliament. Parliamentary oversight, I want to emphasise, is one of the cornerstones of our democracy and vigorous monitoring of the executive – one of Parliament's primary responsibilities. At the core of Parliament's oversight function are the constitutional provisions that empower Parliament to carry out its oversight work as envisaged in Section 55 (2)(4) of the Constitution, which gives us the mechanisms for the National Assembly. In the letter dated 17 March, on behalf of SCOPA, I extended an invitation to Mr De Ruyter to appear before the Committee. The sole purpose is to have an open and frank discussion pertaining to the misuse of public funds at the power utility, as raised in the interview, including the submission of any relevant records and evidence that may have a bearing on financial mismanagement. It is worth stating that Eskom is riddled with a myriad of complex challenges that have accumulated over the years: challenges that have been exacerbated by fraud, corruption, mismanagement and disregard for legislation that regulates public entities; indicative that State Capture is not a thing of the past. These challenges have subsequently led to record high debt levels that continue to put undue pressure on the fiscus, in the form of bailouts, extended to the power utility, given that it is too big to be allowed to fail, as outlined by the strategic importance of this public entity. These challenges have also resulted in Eskom implementing the worst power outages on record, due to generation capacity constraints, adversely impacting the country's economy and ordinary South Africans, amongst others. So the power utility has remained in a stagnant position of qualified audit opinions, with material findings on compliance with legislation for the past five financial years. These areas of qualification include irregular expenditure, fruitless and wasteful expenditure, as well as losses due to criminal conduct – a recurring theme in Eskom’s audit outcomes. The power utility also continues to make use of the independent auditors to conduct its audit, with the AG (Auditor-General) overseeing the audit and reviewing high-risk areas. It is worth noting that SNG Grant Thornton were the independent auditors used from 2015 to 2021. Consequently, the publication of the 2022 annual financial statements was delayed due to delays in appointing the external auditors. Eskom’s delivery of its primary mandate to provide sustainable electricity solutions is key to the economy and building a capable state for the people of South Africa. For the entity to be able to deliver on its mandate, its environment must be characterised by robust national management systems, credible financial and performance reporting, compliance with applicable legislation and a commitment to ethical conduct by all. As I draw to a conclusion, as I want to frame the dilemmas in which we have at Eskom. As a state-owned entity, Eskom must implement government policy and strategy to ensure that power utility remains a critical and strategic contributor to the country's goal of ensuring the security of electricity supply, and enabling economic growth and prosperity. The power utility generates approximately 95% of South Africa's electricity use in South Africa and approximately 45% of electricity used in Africa. Therefore, we are gathered in an effort to ensure accountability, as well as efficient and effective financial management of the state's resources, especially in a time where State Capture is rife. SCOPA is therefore committed to holding Eskom to account and to ensure that suitable consequence management and legal action follow if the allegations made in the interview are proved to be true. So I would like to invite Mr De Ruyter at this point in time. If there is any comments, because we have received his submission and was taken as read, and to put it to him if the submission we have is in fact his submission and the basis upon which we can proceed with our interaction this morning. Mr De Ruyter, good morning and over to you.

Mr Andre De Ruyter (former Eskom CEO): Good morning, Hon Chair and good morning to Hon Members…

Chairperson: You can unmute Mr De Ruyter.

Mr De Ruyter: Sorry? Can I try again? Am I audible?

Chairperson: I still cannot hear you. Gentlemen, why are we not hearing?

Mr De Ruyter: Can I just do an audio check again?

Chairperson: Alright, there we go. We got you. Alright, we got you.

Mr De Ruyter: Apologies for that. There must have been delays somewhere. Good morning, Hon Chair (and) Hon Members. Thank you for the initiation to engage with SCOPA again, albeit this time in a different capacity. I approached the Committee out of respect for its constitutional role. Over the time of my tenure at Eskom, I have had numerous engagements, as the Committee well knows, and I think it has been characterised by a mutual desire to try and seek an improved governance framework for the utility and to ultimately improve the supply of electricity to the country. And it is in this context, therefore, that I accepted the invitation and that I wish to engage. Hon Chair, I just wish to raise a number of important points before we proceed to questions, based on what I was asked to prepare, and to respond to findings of the Committee. And let me first of all say that I submit the information in good faith. To the best of my knowledge, it is true and correct. But I am constrained in providing certain information for the following reasons: having resigned as the Group Chief Executive of Eskom in February, I am not in possession of certain documents and material that remain in the position of Eskom or in the hands of law enforcement bodies to corroborate or substantiate certain allegations. I am therefore constrained regarding certain allegations, and the amount of detail that I can provide with regard thereto. Respectfully, I would like to direct the Committee to engage with those entities to obtain (the) said detail. Having regard to the nature of the alleged criminal and unlawful activities, the sources that I have relied on to inform law enforcement and intelligence agencies have legitimate reasons to fear for their safety. I am therefore not able to divulge their identities, because doing so will undoubtedly compromise their identities and their safety. To the extent that these are known to the Directorate for Priority Crimes Investigations, otherwise known as the Hawks, I respectfully direct the Committee to direct inquiries to the officers investigating these cases. The third point is that the alleged criminal and unlawful activities that are currently under investigation are of a very sensitive and complex nature and it involves elements that are best characterised as organised crime. As these investigations are currently ongoing, and having regard to the public nature of the proceedings at SCOPA, I would not wish to be seen to be defeating the ends of justice by divulging information that may compromise the successful arrest and prosecution of individuals implicated in these activities. Again, if the Committee wishes to engage with the Hawks and other entities to obtain further information, I respectfully direct the Committee to the appropriate officers, who are in a better position to judge what information can be disclosed without compromising ongoing investigations. There are also various forensic investigations aimed at garnering evidence of critical recoveries that are subject to legal professional privilege. And this privilege attaches to Eskom and obviously not to me in my private capacity. And therefore, if the minutiae of these investigations were to be published, it would compromise Eskom’s ability to make these recoveries. In any event, it is not up to me to waive that privilege, but it is the prerogative of Eskom to do so and I can therefore not breach that privilege by disclosing that information. With that introduction, Hon Chair, I then hand back to you. Thank you for the opportunity again.

Chairperson: No, thank you very much. Just the submission that we received, can one confirm that it is your submission – the submission to SCOPA, dated 24 April 2023?

Mr De Ruyter: That is right, Hon Chair.

Chairperson: Alright. Thank you very much, Mr De Ruyter. What we will do is that we will handover to colleagues, because as I have said, we are taking the submission as read. So Hon Hadebe, it is 09:15. Your 20 minutes starts now.

Mr B Hadebe (ANC): Thank you, Chair. Welcome colleagues. Once again, let me take this opportunity to appreciate the time and effort from the former Group Chief Executive of Eskom and to state upfront, Chair, that I think his tenure for the past three years that he served at Eskom, he has been cooperative, and we have worked well with him. And I am hoping that based on the allegations that he has raised on several platforms, he will then still continue to cooperate and assist the Committee to get to the bottom of all these alleged activities of corruption at Eskom, in order for us to root out such, and report those to the relevant law enforcement agencies, for them to conduct their work. I will be happy if some of these questions we will ask, if in any way it will compromise the investigation, you indicate when such (a) question is asked and be able to share (with) us the basis of you thinking that it will do such. I will start with a question of the Minister that was not mentioned in your report. You were quoted as saying a certain minister said ‘In order to pursue the greater good, you have to enable some of the people to eat a little bit.’ Can you please share with us who is exactly this Minister you are referring to, who said to you when supporting issues of serious crime, organised crime and corruption at Eskom, the minister said to you ‘In order to pursue that data good, you have to enable some people to eat a little bit’?

Chairperson: Mr De Ruyter, I think for time management, we will do like you are accustomed. I will not come in-between as Members are asked questions. So you can respond directly.

Mr De Ruyter: Thank you very much, Hon Hadebe. Just to give the context to the statement that was made by the Minister concerned, is that this was not a response that related to general corruption and fraud at Eskom. This was in response to a concern that I expressed to the Minister and also to other individuals, about the governance of the $8.5 billion funding that South Africa obtained at COP 26, and that would, in a very large part, be applied to the benefit of Eskom. Obviously, when such a large amount of money is made available to an entity with a history of a chequered past when it comes to governance and how funds are managed, concerns arise that this money should be tightly controlled. So I must just stress that at no time was the discussion about the broader elements of poor governance or any condonation by the Minister concerned, of that nature. So I would not want this statement to be characterised as a condonation by the Minister that there was a broad allowance made for people to so-called ‘eat’. I think this is an important context. In view of the restrictive nature of this statement that was made, I think that it would be – in terms of the four points I mentioned at the outset – not appropriate for me to divulge the identity of that Minister, because I do not think that it can be construed as a general approval or support of corruption and theft that is still ongoing at Eskom. Thank you.

Mr Hadebe: But Mr De Ruyter, in your interview, you said there was one particular high level politician involved in this allegation. And you informed the Minister, but “The Minister looked at the senior official and said, ‘I guess it was inevitable that it will come out’, suggesting that this was not new.” Now, it is clear that you are referring to issues of corruption, and when this Minister responded in the manner in which he responded, you said it was clear, this was not new to the Minister; and these are issues that are related to corruption. And I think the Committee and South Africans deserve to know who these Ministers are who have taken an oath to protect the resources of the country, who have uttered these words to you? I do not think disclosing the identity of that particular Minister will jeopardise in any case, because it was said in front of another official. And my next question will be: who was the official involved? I take it that those two characters, the Minister and the official, are still continuing business as usual and are still executing the role and responsibilities entrusted upon them. And who knows, they might be continuing, allowing or enabling an environment where corruption must prevail. So, ours here is to pursue a path that will lead us to rooting out corruption at Eskom. Hence, I am pleading with you to share with us the name of that particular Minister.

Mr De Ruyter: Thank you, Hon Hadebe. And again, through you, Chair. I disclosed all of the findings and the issues that I uncovered with my shareholder representative, Minister Pravin Gordhan. And, as I say, in my statements, I also shared the same allegations and concerns with the National Security Adviser, Dr Sydney Mufamadi. What they did with that information, I am not aware, although there has subsequently been progress made and in fact…

Mr Hadebe: My apology, and I am sorry to interject. I am referring to your interview and my question is direct. The Minister that looked at the official in the eye and said, ‘I guess it was inevitable that it will come out anyway.’ “When you said there was one high level politician involved in this allegation: who is that Minister? Are you saying the executive authority, Mr Pravin Gordhan, is the Minister you are referring to? I am asking a specific and direct question based on your interview.

Mr De Ruyter: Alright. If you can please give me a moment that I can just consult my documents that I have in front of me, as well as my advice. At this point in time, Hon Hadebe, I do not think it is in the interests of the oversight role of SCOPA, and the nature of the engagements that I disclose this today. I do not think it is a critical element that is important. I therefore propose that we move on and that I do not disclose the identity of this Minister, because I do not think that it is required for us to enhance… As the Hon Chairman said, the sole purpose is to look at the potential misuse of public funds. And therefore, I would not want to elaborate on that, at this point in time. Thank you.

Mr Hadebe: Through you, Chair. Is allowing politicians to continue misusing public funds, not a concern or fall within the mandate of this Committee, for us to be able to follow and root out corruption as it relates to the public purse? Can I just get the guidance? Please advise if the question posed by myself is out of line in terms of the mandate of SCOPA, in relation to the public purse.

Chairperson: I do think that having a Minister involved in these matters in the manner in which it has been framed, is in the interest of the Committee. So I think the question is well in order, because we have been saddled with the situation of political leadership interference in the affairs of departments and entities. And I think insofar as having a frank discussion, the question that Hon Hadebe is posing is a fair and correct one. Hon Hadebe?

Mr Hadebe: Thank you, Chair. Perhaps, just to also amplify my question. At the time you were an accounting officer, and Section 38 (1) of the PFMA requires that as an accounting officer, you must take effective and appropriate steps to prevent losses resulting from criminal conduct. Furthermore, you are also responsible for managing, including safeguarding of the assets of Eskom. Now, surely, when an executive authority is implicated in allegations of misappropriation of taxpayers’ money, it was incumbent upon yourself to act; hence I am asking this question. It is in line with your responsibility at the time to ensure that you prevent losses that are as a result of criminal conduct. And in your interview, you have stated having reported this matter to a Minister. It is in line with our mandate and function as this Committee, to get to the bottom of this and to understand exactly who is enabling corruption to prevail at Eskom and we are going to follow that matter up and refer it to the relevant structures and authorities to deal with, but for us is to investigate as per our mandate. Once we have investigated, the other relevant authorities and law enforcement agencies in the country will take over from us. We are not saying that have powers to conduct what law enforcement agencies are entrusted to do. But we want to get into the bottom of the roots of corruption at Eskom and to prevent it from happening in the future. My worry is that this high level official might still continue doing what you have highlighted as something that was not new to them. Thank you, Chair.

Mr De Ruyter: Thank you, Hon Hadebe and thank you, Hon Chair, for that clarity you provided on the scope of the engagement today. First of all, to clarify my role as the former accounting officer for Eskom and the PFMA obligations I accepted. I did engage with the South African Police at the highest level, with the National Commissioner of Police, and a number of other senior officials, generals, brigadiers, as well as senior representatives of the SSA (State Security Agency). I also shared information about corruption and theft with the NATJOINTS (National Joint Operational and Intelligence Structure) at the South African Police Services College in Pretoria. And that, I think, gives sufficient credence to the fact that I think he engaged with the law enforcement authorities to make clear that appropriate steps should be taken. I also took steps to ensure that I could improve internal controls; should the Commission or the Committee so wish I will elaborate on that. In my submission to the Committee, I do reflect on, for example, the measures taken to improve supply chain controls, control over coal quality, and management and so forth. So I do think that I am comfortable that appropriate steps were taken in order to ensure that we do have significantly enhanced controls. As is required, I also reported this to my shareholder representative, as I said, Minister Gordhan. He was accompanied by the National Security Adviser to the President. And the main findings were again, shared with these two officials. And I think that I discharged my duty to report. I may also add for… to preempt any potential question in this regard, that I have complied with Section 34 of the Prevention of Organised Crime and Corruption Act, the PRECCA Act, by ensuring that I can share with DPCI (Hawks) the information that is at my disposal, and my legal advisors have made a submission to the Hawks in this regard, in full compliance with Section 34 of PRECCA. Again, to move back to paragraph one of my submission – disclosing the identity of the Minister concerned. I think that this is a question which I would see falling within the ambit of potential security risks that could arise from such a disclosure. And I therefore would direct, with respect, the Committee to rather engage with the oversight Minister, as well as potentially, if the Committee deems fit, with Dr Mufumadi to obtain further information in this regard. Thank you.

Mr Hadebe: If I am hearing you correctly, did you disclose to Mr Mufumadi and the Executive Authority, Mr Pravin Gordhan – the name of the Minister you are referring to – for us to be able to make a follow-up on this matter?

Mr De Ruyter: I did disclose.

Mr Hadebe: Am I hearing you correctly? Have you disclosed the name of the Minister that you are not willing to identify to Mr Mufumadi and to the Executive authority, being Minister Gordhan, in this case?

Mr De Ruyter: Hon Hadebe, just to be clear: there is a narrative in the media that there is a Minister that I mentioned. I must just avoid in this regard. I never made any statement to the fact that it is a Minister. I said that it was a senior politician. So I do not want to perpetuate any misunderstanding in this regard. I had also seen…

Mr Hadebe: I am sorry to interject, but I have listened to your interview, time and time again, and I am quoting exactly what you have said. You said, “The Minister looked at the senior official and said, ‘I guess it was inevitable, that it will come out anyway’, suggesting that this was not new.” You did make mention of the Minister. Hence my question to you is: did you inform Mr Sydney Mufamadi and Minister Pravin Gordhan of the name of that Minister or that high-level politician involved in corruption? You are referring us to both these two individuals for further information. So will these two individuals be privy to the name as reported by your good self?

Mr De Ruyter: Hon Hadebe, I cannot obviously talk on behalf of those two gentlemen, that is up to the them.

Mr Hadebe: No, but I am saying did you mention the name?

Mr De Ruyter: I did disclose it to those two, yes.

Mr Hadebe: The name of the Minister?

Mr De Ruyter: No, the name of the senior politician.

Mr Hadebe: So would I be correct that you are also protecting this Minister that you have supported this matter to?

Mr De Ruyter: I think characterising…

Mr Hadebe: I am saying I would understand and accept when you are saying to us you are not going to disclose the name of the Minister. But at some point during your tenure, you did report this Minister to the relevant authority. If yes, please refer us (to) which relevant authority you have reported this Minister (to). You have painted a picture of senior Ministers involved in corruption or allowing corruption to happen without acting. Now we are saying please assist us to deal with that particular Minister in the manner that is in line with the laws and provision of powers and functions incumbent upon any relevant structure within Parliament. Did you at any point mention the name of the Minister to the relevant authorities responsible for law enforcement in this country?

Mr De Ruyter: I think, Hon Hadebe, I am obviously not a lawyer versed in criminal law. But I am not sure that the statement that was made by the Minister concerned in fact constituted contravention of law. So I do not think there was a duty on me to disclose or share that with any law enforcement authority. I do not believe that there was a legal duty on it because it does not fall within the bounds of any contravention as contemplated by PRECCA or by the PFMA. I think that the matter is best resolved if I may, Hon Chair, by the Committee addressing the question directly to…

Mr Hadebe: Sorry, Mr De Ruyter.

Mr De Ruyter: If you can just allow me to finish, please? To Dr Mufamadi and Minister Gordhan.

Mr Hadebe: I am trying to understand, when the Minister says to you ‘In order to pursue the greater good, you have to enable some people to eat a little bit’: what does that mean to you?

Mr De Ruyter: I think what it speaks to, Hon Hadebe, is a general condemnation or climate, where corruption is tolerated, where it is deemed to be, if you will, the normal course of business. And that is in fact a way of ensuring that business gets done. And I think that speaks to a general approach to crime and criminality, where it is tolerated. When I think, if I may presume to characterise my engagements with SCOPA, is that SCOPA has a zero-tolerance approach to these matters. And therefore, I was taken aback and surprised when I heard this particular statement.

Chairperson: Just one second Hon (Hadebe), so that we can wrap. We will rotate and come back. Mr De Ruyter, I think pointedly, is where we need clarity. You say that you have complied with PRECCA and you invoke Minister Gordhan and Mr Mufamadi. So I think pointedly, Hon Hadebe’s question is, this individual, high-ranking politician, senior politician, Minister – did you report that to the Minister, Minister Gordhan, and Mr Mufumadi and the who? Or did you report that to the law enforcement agencies for the purposes of investigation; this particular senior ranking, high official politician and or Minister? Because that would form the basis upon which any investigation must proceed. That so and so, is this. So I think to sort of just clear the woods on this one. Is the name wholly reserved either here or wherever? Because if that is the case, I do not see any basis upon which an investigation could take place, given that you have got 30 Ministers – 29 Ministers and some 30-odd Deputies?

Mr De Ruyter: Yeah, I think if I may venture to answer that question, Hon Chair. The best way forward, I would suggest, is to ask Minister Gordhan and Dr Mufamadi, because they were informed, they are aware. As you know, I am not in a position where I have immunity and I therefore am unable to make any statement that could potentially put me at risk of any legal action, whether it be civil or criminal, because of the fact that there is already a highly litigious environment that has arisen around Eskom and my tenure as Chief Executive at Eskom. And I would be very loath to expose myself to any further legal action, particularly in a public forum, such as this hearing. So, respectfully, I think, to answer those questions, it is more appropriate to direct those to the individuals that I have already mentioned by now.

Mr Hadebe: Chair, I think too – I feel for you and I take your point, but you can be protected under the Powers and Privileges of Parliament Act, if you are willing to take an oath or affirmation. So we are willing to provide you with that protection you deserve, in order for you to be able to engage freely and help this Parliament and South Africans in general, who are currently faced with Stage Six load shedding, and there are still people there on daily basis, who knows what they are doing, and continue to earn a salary. So are you willing to be protected by taking an oath of affirmation, in order for you to help South African rid Eskom of corrupt elements and officials?

Mr De Ruyter: Hon Chair, I stand by my answer. I think just to reiterate, I am here to assist the Committee in endeavouring to improve its oversight. In my previous appearances of SCOPA, I never took an oath that was not a requirement. And I think under the current circumstances, given the fact that this is not an inquisitorial investigation, it is not a parliamentary session, there is no opportunity for me to be subjected to cross-examination or to legal representation who can clarify and elucidate any answers that I might have. So even if I were to enjoy the protection of Parliamentary Privilege, the concerns that I have in terms of security would still apply. And therefore, I would stand by my answer as I have given it, and I again, recommend that the Committee should address the two individuals concerned and raise their concerns with them or their questions with them, and hopefully that will then put the Committee in a position where they can clarify this matter.

Mr Hadebe: We are willing to continue on and question those that you have mentioned. But I was asking a simple question, in order for us to also protect you and gathering from what you are saying as your response, (it) appears as if you are not willing to take an oath or affirmation. Would my assumption be correct to say at this point in time, you do not see it fit for you to be protected in terms under the Powers and Privileges Act of Parliament?

Chairperson: Let us do this. That will be the last one. We will rotate and come back. You have gone… yeah. But no, we will come back. We have got time.

Mr Hadebe: Can I just ask one last question?

Chairperson: Alright, close it off. Close it off, it is fine. Last one.

Mr Hadebe: Chair, do you have a Deputy Chair?

Chairperson: No, Bheki. You must speak through me.

Mr Hadebe: No, but I do not take kind, Chair, when dealing with serious matters, we have people…

Chairperson: Bheki? Hon Hadebe?

Mr Hadebe: I really do not take kind with that.

Chairperson: Hon Hadebe, I am saying to you, ask your question and close it off on that last one. And then we will come back for round 2. So if you have a last question, put that last question. Then Hon van Minnen, stand by.

Mr Hadebe: Thank you, Chair. Mr De Ruyter, you have said you have also complied with Section 34 (1) of the Prevention and Combating of Corrupt Activities Act. So I assume that you have reported such acts of corruption to the relevant police officer? That Act also stipulates that the police officer concerned must take down a report and provide a person who made a report with an acknowledgement of receipt of such a report. Have you in your submission received any acknowledgement of receipt of your reports? And are you able to direct us to the relevant police officer involved in you providing information as it relates to Section 34 (1)?

Mr De Ruyter: Hon Hadebe, as the Section 34 submission was made to the DPCI by my legal team, I would have to consult my legal team to inquire from them whether they have received a receipt, as you indicated, and what the identity of the police officer is concerned with. I do not have that information to hand today, as I sit here. Unfortunately I cannot give you the answer to that question. I would have to consult with my legal team, because they are the ones who made the submission on my behalf and with my mandate.

Mr Hadebe: But Mr De Ruyter, as an accounting officer, then you should have known the provisions of the Act. And for you to say, you have fully complied, you ought to have received acknowledgement of your report having been furnished to the office, and you should be in a position to know exactly who the officer involved is. And whether you have submitted yourself or through your lawyers, your lawyers ought to have briefed you to say ‘Here is an acknowledgement of receipt. And the information was submitted on this date to this particular officer.’ Now, for us to be able to pursue these matters, there are still unanswered questions, and it defeats the entire exercise. But I take your point when you are saying you will have to consult. I guess we will have to then put timeframes to ascertain whether or not indeed Section 34 (1) was fully complied with. I take it that at the time of submitting, you were still an accounting officer at the time? Will I be correct that all these reports were submitted, while you were still an accounting officer?

Chairperson: I think that distinction is important, as to when that was done, so that it can provide direction, because if it was during your tenure as CEO, then Eskom must also have those records. So I think that clarity is important.

Mr De Ruyter: Hon Chair, there is, as a matter of course, Section 34 reports that are made by Eskom to the DPCI, in compliance with Section 34. And this is because there are many of these incidents with more than 100 cases that are reported. And because the accounting officer has the obligation, that report is therefore made, and Section 34 is complied with. There is a distinct process that is in place to ensure that we keep the DPCI informed. I must also point out that with regard to the particular information that came to my attention – this was handed by my legal team, to the officer in authority, the officer in charge. Again, I would have to confirm who exactly the person was to whom it was handed, and whether or not a receipt was provided. I cannot give you that information right now; I do not know. But generally speaking, Hon Chair, I think it is important to emphasise that I raised this matter with the highest law enforcement officer in the country, the National Commissioner of Police, and I did so on two occasions where I made clear that there were significant activities of crime and corruption taking place at Eskom; that there were incidents of sabotage that Eskom was experiencing and displayed a considerable role. I also cooperated fully with officers that were appointed by the National Commissioner of Police. So from that perspective, substantive compliance took place. The formal submission as required by the regulations to the South African Police Service Act was complied with after I left the employ of Eskom. But in general, Section 34 was complied with, and substantively Section 34 was complied with by means of my direct communication with senior police officers, including the National Police Commissioner.

Chairperson: We will come back to you. Hon van Minnen?

Ms B van Minnen (DA): Thank you very much, Chair. Good morning, Mr De Ruyter. We find ourselves in a difficult situation currently, whereby there was a Motion to Parliament, to in fact, establish an ad-hoc committee to investigate the issues at Eskom: that was voted down. The Ruling Party used their majority to stymie that. So that is not going to happen. So we are currently in a situation where SCOPA really has to do what it can to unpack the issues that need to be aired. Now, you have appeared before us on numerous occasions, and we have heard extensively from you about the issues at Eskom. And you stated that there was intense state interference. And then you have also gone on to talk about, you know, the trio of issues being the lack of skills, the lack of investment in infrastructure and the lack of foresight. But given that, and given the situation that we are currently in with the misuse of public funds, how much of this issue we now see at Eskom, and the utter destruction of the electricity situation in South Africa, can we put down to essentially state meddling in an entity that should be allowed to get on with doing what it does?

Mr De Ruyter: Hon van Minnen, it is an interesting question: whether it is state meddling or the absence of state support that is responsible for the fact that there is significant load shedding there that afflict South Africa today. First of all, again, just to stress that I think it is common cause by now that there is rampant criminality that afflicts Eskom and that that creates the opportunity for criminals to take advantage and have an impact, negative impact, on the ability of Eskom to produce electricity. If I may just refer the Committee to a statement made by the Regional President of the National Union of Mineworkers, Mr Malekutu Bizzah Motubatse and he said that the reason for load shedding really is crime and corruption and collusion. What we have seen is that there have been some movements. I firmly believe that if Eskom did not bring the matters of crime and corruption to the attention of the public, to SCOPA, as well as to the attention of law enforcement and our shareholder department, then, some of these changes would not have been made. It is clear that even the Minister of Electricity has now said that sabotage plays a major role in load shedding. Former Group Executive of Generation, Mr Rulani Mathebula, said fraud and corruption are the biggest enemies of progress at Eskom. So this is a well known situation. Hon van Minnen, I therefore find myself in a situation where on the one hand there is, I think it is fair to call it, interference in the affairs of Eskom, because with respect, typically politicians have a time horizon that is shorter than the time horizon for a power utility. Power utilities tend to think in time horizons of 20 to 30 years. And there is a long history of decisions that were taken, dating back to 1998, of politicians, for example, preventing Eskom from adding new capacity, from preventing Eskom from going out to the market and procuring new generation capacity. And to that extent, I think your comment is probably valid that political interference has had a negative impact on the ability to supply electricity to South Africa. But on the other hand, the lack of intervention in crime in Eskom, I think, is something that afflicts the organisation to this day. I am not sure if things have changed much since I have left. But we have certainly been exposed to, I think, a lack of political interference, if you will, in order to address the rampant criminality that is a major contributor to load shedding. Thank you.

Ms van Minnen: Thanks very much. Now in terms of the figure that you gave of approximately R1 billion being stolen from Eskom, every month, and you break that down in your statement, you go on to talk about the intense internal resistance that you faced at Eskom, you have mentioned this before, as well, to SCOPA, and the pushback against introductions of internal controls. Given the size of the actual theft, and the cartels, you have explained about the cartels, particularly in Mpumalanga, in terms of the quote about collusion is it reasonably possible that this kind of looting of a state entity could go on over this period of time without some kind of collusion or at least complacency from the actual – I am not talking about the Minister – but in terms of the actual stakeholder and the state itself? Is it possible that this can happen without some kind of collusion coming from the state entities?

Mr De Ruyter: Hon van Minnen, it is a tricky question to answer, because you need to define at which stage does complacency become complicity. And I think when you look at the changes that have been made as a result of steps taken by Eskom under my management, there has, to be fair, been some progress. In the State of the Nation of Address, the President, in February of 2023, said that 43 arrests have been made at Eskom installations in Mpumalanga, due to an intelligence-led operation. There have been various changes made to the senior management of the police in Mpumalanga. I think, since those changes have been made, we have seen a renewed energy from the South African Police Services to bring criminals to book. This was in fact, an undertaking that was provided by the National Police Commissioner during the meeting, which I had in June, at Megawatt Park. Soldiers were deployed at four Eskom power stations – four black sites for black sites, so-called, where coal has been stolen. Those were raided by the Hawks. There is apparently a further 30 under observation. There was a special investigative team that was established by the South African Police. But I think the point to make here is that it took an extraordinary effort to enable this to be brought about. If we, as Eskom, did not continuously push this, I do not think that these steps would have been taken, and the looting would have been able to continue and unchecked. And therefore, you know, I think there is a political comment to be made, which I would refrain from doing about the borderline, as I said, between when complacency becomes complicity. Thank you.

Ms van Minnen: On that point of when complacency becomes complicity when did you start to report these issues to the police and to the relevant authorities? I mean, you have talked about the meeting in June last year. But as you have been at the helm of Eskom since the beginning of 2020, when did you first commence with reporting these issues?

Mr De Ruyter: So the first reporting obligation is obviously an ongoing reporting obligation and this was, I think, reported continuously as certain crimes were detected. And I do not want to make light of any criminal activity, but there are crimes that have become, unfortunately, of a routine nature. And these relate to, for example, theft of infrastructure, cable theft, and so forth. And these, of course, are reported by Eskom, on a continuous basis, not necessarily by myself personally, but also by our security staff in our various locations – in Eskom’s various locations across the country. I first made, I think both SCOPA as well as the Police, aware of criminality affecting Eskom, very soon after I started my tenure. You may recall that there was a series of media reports about the infamous R238 000 mop, the R80 000 knee-guards, and so on and so forth. So there has been a continuous effort to engage with the police; meetings were held, not necessarily by me personally, but certainly by our security staff with the police, in an attempt to ensure that we can get better cooperation and support from the police. The major meeting took place on the 4th of June 2022. And this was after we had been investigating the possibility that that criminality was, in fact, of an organised criminal nature. And this is when it was shared with General Masemola, senior generals in the SAPS, as well as officials from the SSA (State Security Agency.) I hope I have answered your question. Thank you.

Ms van Minnen: So was it at this meeting on the 4th of June that you reported the fact that a senior politician appeared to be involved with this as well?

Mr De Ruyter: No, I did not disclose it at that meeting, because of the fact that, obviously, this is a very sensitive and potentially risky disclosure to make. And I offered to share and subsequently did share with the designated senior police officer, all of the information that was at my disposal, including the names of people who are alleged to have been involved in criminal activity of whatever nature at Eskom.

Ms van Minnen: Now those names, is that where you included the name of a senior politician?

Mr De Ruyter: That was in fact reported to the police. The police is aware of this. And therefore, I, in my introduction, said that I need to be careful that I do not inadvertently defeat the ends of justice by making disclosures that could compromise ongoing investigations.

Ms van Minnen: Okay, I understand, but can you share with the Committee when you first became aware that there may be senior politicians involved with this situation?

Mr De Ruyter: That first came to my attention, I think around about April/May of 2022. Prior to that, we were not cited. And we certainly were extremely concerned about the level of criminality at Eskom. We took steps to try and manage the situation and to ensure that we could protect the entity but we did not have any indication that there was political involvement. That became, well the allegations in this regard became clearer as we started to interrogate the sources of criminality more closely.

Ms van Minnen: So then that political involvement or should I say, rather, the involvement of people with political connection, was that then made known to the shareholder to Minister Gordhan?

Mr De Ruyter: Yes, it was.

Ms van Minnen: So at what stage, what time last year, was he aware or made aware of the situation?

Mr De Ruyter: This would have been also around June or July.

Ms van Minnen: I mean, would it then have been reasonable for you to assume that this would have been important politically and discussed in Cabinet or with the President?

Mr De Ruyter: I obviously cannot speak to what Minister Gordhan did or did not do with the information. But, I would assume that he made his principles aware; that would certainly be the reasonable and practical thing to do, having regard to the knowledge, or the information, that was provided to him.

Ms van Minnen: Given the fact that we are now sitting 10 months later, and we are very much at an impasse, as we have already discussed this morning, at what point – coming back to your issue about when does complacency become being complicit – in your opinion, what is your view that nothing has actually happened or nothing appears to have happened in the last 10 months, despite that information being given to the shareholder?

Mr De Ruyter: I think that to be fair to the police, something has happened. I have listed some of the issues that have been put in place, changes to management, task forces that were deployed, arrests that have been made, and so forth. I am not privy to the investigation being conducted by the police, but I would assume that they are pursuing leads that have been provided to them. And I would sincerely hope that they continue this investigation, and bring it to a conclusion either way. So I would not characterise it as nothing being done. But I do think that it has taken an extraordinary effort, for which had to be driven, frankly, by Eskom and by myself and my management team, to get the law enforcement agencies and the intelligence agencies to get to grips with these issues. And, and I am pleased that at last, we appear to be seeing some action in this regard.

Ms van Minnen: Now, this senior politician, is it just the one senior politician or are there more involved? Also what I want to know is, are they currently serving or not serving in Parliament or are they in the other entities?

Mr De Ruyter: I think that it appears that politicians are involved at a number of levels, so I would not characterise it as being confined to a particular individual. And Hon van Minnen, with respect, in order to ensure that we do not get to the thin end of the wedge by starting to eliminate potential individuals, I will prefer not to answer your question with regard to whether this is a Member of Cabinet, a Minister serving or non-serving. I think all of those facts are adequately covered in my submission. And I would prefer to stand by that for the reasons that I have elaborated on.

Chairperson: Mr De Ruyter, but I think you need to help us here. I think you have been at pains to explain your reasons (and) we will look at it, in terms of why you will not disclose the name. But I think it is helpful. Is there a Minister involved, as you say, became aware in May or April 2022, of the issues that you are raising? I think that is where Hon Van Minnen is driving at. You say that the Shareholder representative, Minister Gordhan, would have been made aware about June or July. I just think that that is helpful. It is not helpful just to us, it is helpful to the President, Cabinet, the country, if you are saying is there a Minister. I do not think that compromises anything, in fact, it enriches what I would imagine is why you would have had the interview and subsequently this engagement. If we are saddled with the situation of a Minister of State involved, then I think we ought to know. So I think Hon van Minnen’s question is very fair, in this regard, and I would implore you to give us a response in that regard.

Mr De Ruyter: Thank you, Hon Chair, and thank you Hon van Minnen. With respect, I think I will stand by my statement that there appears to be a senior politician involved, and based on legal advice that I have been provided, disclosing further information could expose me personally to legal risks, but also, from an investigative point of view it is important that we do not compromise ongoing investigations. And therefore, respectfully, again, I would direct the Committee to rather approach the Hawks, relevant law enforcement authorities to disclose what they are able to disclose, because that is not a decision that is up to me to make, and I would be very loath to compromise, any ongoing investigation by inadvertently undermining by prematurely disclosing any information.

Ms van Minnen: In terms of this ongoing investigation, do you believe it will be allowed to go ahead without being hamstrung by political interests?

Mr De Ruyter: Hon van Minnen, the honest answer is I do not know. I think we, as South Africans, should probably be vigilant in this regard, and ensure that there is a full and proper investigation and that answers can be had with regard to who is involved and the extent of involvement. It is clear that the supply of electricity in South Africa is of a national interest. And therefore, this is one of the roles I would suggest with respect that SCOPA can play to ensure that in fact, such investigations are done and that they are carried through to their full consequence.

Ms van Minnen: Just to wrap up this particular rotation: given with what I started with, that the motion to have an ad-hoc committee into Eskom was voted down. And also yesterday in Parliament, by the Parliamentary Committee, it was decided that there will not be a Standing Committee holding the new Minister of Electricity to account; that they will continue to use the current committees. Do you think that were there to have been a special parliamentary investigation with an ad-hoc committee, would that have added value to this investigation? And do you believe that would have taken us somewhere and actually shining a light on the stage in the gloom that is really concealing what is going on at Eskom at the moment with this corruption and theft?

Mr De Ruyter: Parliament is obviously the pinnacle of our constitutional democracy in South Africa. It plays a critical role in oversight. And therefore, I would imagine that a Parliamentary investigation into this, that is structured appropriately, would have had some benefits with powers to call certain individuals, and to ensure that a proper investigation is done. But this is not a matter for me to make a pronouncement on. This is a political matter. And as I say, I can only hope that the law enforcement investigations that I am told are currently underway, will be carried out to their full consequences and that these are not deprived of resources, for example, or that they are not stymied in some other way. And I think this is our best chance of bringing the criminality that it currently afflicts Eskom under control.

Ms van Minnen: Okay, thank you very much.

Chairperson: Thanks, Hon van Minnen. We will do the rotation: Hon Mente, stand by. But can I just maybe get clarity for the purposes of understanding what is a senior-ranking politician? If you could define it for us? Because what I am trying to get at, Mr De Ruyter is, we need to be in a position to understand where the interference is coming from to understand its construct. So what is a senior ranking politician or senior politician? And is this senior in government or senior in political party or senior in activism? But what is a senior ranking politician?

Mr De Ruyter: I think, Hon Chair, here I would again, stand by the submission that I have made. A senior politician is exactly what it means. Without wanting to cast any aspersions on yourself, you are probably a senior politician. So let us leave it at that. I stand by the issues that I raised in my submission.

Chairperson: Yeah, alright. But I think at the same time it does help us because then as opposed to converging us to a point of specificity – that becomes a generalisation, which then anybody could have made. But you were in a position of authority at Eskom, so whilst you are guarded, which we have established now, with the reasons you have given, but at the same time, I do feel that there is no compromising of any investigation to give a pointer, because the seniority you speak about – one can be senior in a municipality, but junior on a national scale, you know? And that is why I was really you would tell us what you mean by a senior politician. And maybe even the question goes on: is this senior politician active or inactive in politics? It is a minefield, which says very little actually. So can I attempt again, Mr De Ruyter, what is a senior politician?

Mr De Ruyter: Hon Chair, I think you have put your finger on exactly why I am reluctant to engage in this line of questioning further, because if I say that it is a senior politician that, let us say for example, not in government, then you will say ‘well, is the party's colour blue or is it red or is it…?’ And then by process of elimination, I will be put in a position where it becomes a matter of disclosure, which, as you would have seen, I am at pains to avoid. So I, with respect, would rather not go down that path because one question would obviously lead to the next question, and by process of elimination, then I would be forced to make a disclosure, which, for the very good reasons that I have already alluded to, I am at pains to avoid.

Chairperson: We will come back to that. Hon Mente, over to you.

Ms V Mente (EFF): Thank you very much, Chair, and good morning to everyone. Chair, I want to first check with your guidance, because we need not to engage in an exercise that is fruitless: that is number one. If we are going to engage, there have been two Members that spoke before me, and they were seeking straight answers, answers which did not come forth. I think we need to guide Mr De Ruyter on what defines something that is under investigation in terms of the law, and an answer that Parliament is seeking in terms of accountability. In particular, in terms of SCOPA and its scope of work. Here, what is involved is public funds; public funds that he willingly went to a public platform to disclose that public funds are being squandered. Thus today, we want him to shed more light into his public platform speaking. And if he is not comfortable saying that here, maybe we should pose a question to Mr De Ruyter as to in which platform will he say what you are saying in the media, and give us the names; which platform will be suitable for him to disclose exactly what we are talking about. We cannot be asking questions for the matter of asking them. That is the first question, Chair.

Chairperson: The same method will apply, Mr De Ruyter.

Mr De Ruyter: Apologies, Chair. I had a slight technical difficulty there. I think, as I have indicated, Hon Mente, I have been fully prepared to cooperate with law enforcement authorities in order to continue with investigations. I am absolutely aware of my legal duty in this regard, and I will continue to ensure that I abide by my responsibilities in this regard. It would, however, I think, be irresponsible of me to, knowing that I could compromise ongoing investigations, knowing that there is a risk of defeating the ends of justice, knowing that there are people who are cooperating with law enforcement authorities, and who safely may be compromised by disclosure to use a public forum, such as the present one, in order to ventilate these concerns, and therefore, I am at pains to avoid that. And if necessary, of course if I am called before a court of law or similar entity, then naturally I will comply fully with my obligations in that regard.

Ms Mente: So in essence Chair, Mr De Ruyter says he went to the media platform to inform South Africa, publicly of gossip. And we must also come here and congregate and engage in gossip. Because if we cannot deal with facts, then we are gossiping. And we are going to be a part of ‘He said’, ‘that happened’, ‘it looks like pink, you know however, it is red.’ So, Chair, I really need your guidance. If this is going to be a matter of when you went to (the) media, he knew he is engaged in a process of law enforcement and investigation. That is well and good. But once you start touching the matter of public funds, which are appropriated, and disbursed at this platform, you then invited us. And upon inviting us, we’re calling you to come here at this public platform, which is Parliament, to account for what that which you have said. Now, you do not want to say what you were saying. And all of a sudden now it is the issues of investigations. The question becomes, Mr De Ruyter, are you willing to just answer us as to who are the people that are involved? Because we are not talking about merits, we are not dealing with any particular facts – we are still going to ask questions about facts. Are you willing to participate in the Parliamentary process of accountability? And do you believe in accountability as a person who has led a very important state owned entity which is falling apart, by the way? So are you willing to work with us and give us the information we are looking for, or are you not willing to do that?

Mr De Ruyter: Hon Mente, good morning. Yes, I am absolutely willing to cooperate with SCOPA, and that is why I voluntarily accepted the invitation from the Committee to come and share with you, to answer questions that were raised, as the Hon Chair said, to investigate the potential misuse of public funds, to improve the functioning of SCOPA. Again, the matters that are at play here are of significant gravity. As I have explained before, compromising myself... exposing myself is not something that I am prepared to do in the current platform. I have fully cooperated with law enforcement authorities. I have fully made available all of the information at my disposal to them. We have seen, as I have listed before, arrests. We have seen interventions in disrupting these organised crime activities. And I think these events are important pieces of corroborated evidence that suggests that the information provided to law enforcement authorities has merit, has value and was in fact, acted upon. And I think that if we now focus on names, then for the reasons that I have, now, repeatedly enumerated based on the legal advice that I have received, it would be inappropriate of me to disclose the information that you ask.

It is not because I do not want to cooperate, and the fact that I am here and that I am engaging with the Committee should be sufficient evidence that I am cooperating. The fact that I am clearly cooperating with law enforcement authorities, then I cannot be put in a position where I will be contravening the other principles of law, as it relates to potentially defeating the ends of justice. And for that, Hon Chair, I again, respectfully wish to direct the Committee to engage with the Hawks, and to ask them what the progress is with the investigation, because I think that this is the way to ensure that there is public accountability. At a certain point in time, these matters are handed over to law enforcement, it then becomes within their purview to carry out investigations. There is not much that I can do as a private citizen to ensure that we can continue these investigations. That is now in the hands of the police. Thank you.

Ms Mente: Well, in that case, Chair, we need not to waste time and invoke a process and a mechanism that is going to allow Mr De Ruyter that is going to give us information. Right now, in terms of our powers and privileges, you are coming here, and you are kind of misleading Parliament. Because when you submitted your report, and when you responded to the letters of the Chair, you said you are coming here to help us deal with the problem which South Africa is facing at Eskom. Now you are unable to do that. Therefore, Chair, I think you need to engage a process of invoking a mechanism which is going to force answers out of Mr De Ruyter. Parliament has got that in its disposal, and that should start today. But in me checking if ever this one can be answered correctly, and if you fail to answer that one, then there is no need for me to continue. You are making a point under 2.2 of your submission, and that point talks to cartels. This matter of cartels has been in the public domain for a period of time. But what is most important here, these cartels are led by a presidential cartel. Please unpack a presidential cartel. What is a presidential cartel? When you say the presidential cartel predominantly operates in Matla and it has got a number of companies under its umbrella – unpack that for us.

Mr De Ruyter: Hon Mente, I think that the name of this cartel is something that as far as I know, is a name that the members of the cartel have come up with. I am not aware that it has got any significance that attaches to anybody related to the Presidency. I think this is a name that they have chosen. Up until recently, when these allegations became public, the members of the presidential cartel had a fairly lively presence on social media. They made a number of statements, saying things like ‘Thanks to coal, we can shower and champagne’ and so forth. And these individuals, it appears, acted with a fair amount of impunity when it came to publicising their activities and what they were up to. And the fact that they have now, since these allegations were made public, desisted from saying anything further, it is probably a very good indication that they were made aware that they expose themselves by going on to social media. And part of my reluctance to share too much information is, of course, that investigations into these individuals are continuing. And that there are, as I am sure Members of this Committee know, significant security risks that are attached to it. There are numerous murders that take place in Mpumalanga related to crime and having been exposed once, I am very reluctant to put myself in that position again. So I think that the presidential cartel is documented. They call themselves that. It is not a name that I have come up with. So again, requesting law enforcement to provide further information on this, which I am sure they will have obtained by now, would be the useful way forward.

Ms Mente: Did this particular Minister or senior official instruct you to give business to that specialised syndicate? And did you comply with that?

Mr De Ruyter: Sorry, Hon Mente, could you please repeat that question?

Ms Mente: Within this syndicate or these cartels, were you at any point given an instruction to give them business or to allow them to do those procurements they were doing, and you complied with such an instruction?

Mr De Ruyter: No, I was given no instruction. And no, I did not comply with any such instruction.

Ms Mente: So the issue of cartels is not a fact?

Mr De Ruyter: I am not sure how you can derive, Hon Mente, with respect, that conclusion, from the answer that I have given. The fact that there was no instruction given by a political principle to direct business to a particular cartel does not mean that that cartel is not in existence and is not operating. I do not think the one follows from the other.

Ms Mente: Okay, let me put it differently. The report on cartels, did you verify it yourself? Do you know for a fact that there are cartels existing in Eskom space? And for how long were you aware of that?

Mr De Ruyter: The allegation around cartels came to my attention in April/May of last year. And as a consequence, I then informed, as I have said, the South African Police Services, the SSA was informed, as well as the Chairman of the Eskom Board at the time, Prof Makgoba, as well as my political principles, the shareholder department, DPE (Department of Public Enterprises). So when I became aware of this, I brought it to the attention of the relevant authorities. And based on what I have seen, I have good reason to believe that these cartels are in fact in existence, and that they do operate within Mpumalanga, and they do extract, by very various criminal practices, money from Eskom, as I have indicated in my submission.

Ms Mente: And with the information that you say you passed over to law enforcement pertaining with that, did you get any joy or is there any progress, which is productive in terms of curbing it, if it exists; or are you getting any joy in establishing if this fact indeed is there? And that procurement process, which you have outlined here, I think it is about two pages of you outlining the system in which they operate. Is this system that you have underlined here been established? Is it confirmed by law enforcement? What is the progress so far?

Mr De Ruyter: Thank you, Hon Mente. I think we have seen progress, which I have referred to earlier. The fact that there have been at least 43 arrests at various Eskom installations. You will have seen a media report, for example, of the arrest of two Eskom employees and a contractor by a specialised unit of the police, worth some R300 000 worth of fuel oil that was not discharged, but corruptly certified as having been delivered. That report came out, I think, last week sometime, so there is progress. I think we have seen evidence that now that these sites where the coal is stolen, that they are being curtailed, that we are seeing some progress being made in the activities of these organised crime syndicates that operate in Mpumalanga. And I sincerely hope that this process continues, because they have a severe negative impact on the ability of Eskom to operate its power stations. So to answer your question, I think that following the reporting of these matters to the South African Police Services, we have seen actions being taken. And one would hope that this continues and that they are also followed by successful prosecutions and prison sentences as appropriate, once those individuals are in fact convicted. Thank you.

Ms Mente: So how many bodies are dealing with this? It is the SAPS, and is there any person who is dealing with that? Because we need to summon those people to come here and tell us what is happening with the cartels at Eskom. Shed the light, how many bodies did you report to? When and who are they?

Mr De Ruyter: As I have indicated, Hon Mente, I have reported this to the South African Police Services and of course, that includes the Directorate for Priority Crime Investigations – the Hawks. I have also reported this and shared it with the State Security Agency, and they are aware of it. And those are the entities that I think are charged with law enforcement in South Africa. So those are the entities that I am aware of that play a role in this regard, and that they are investigating and taking action as they deem appropriate with the information at their disposal.

Ms Mente: And you have sworn statements that you have provided to those bodies?

Mr De Ruyter: I have, as required by Section 34, reported the matter. What I think… What I anticipate the progress or the process will be going forward, will be that they will now investigate these reports. And then to the extent that they require me to make a sworn statement or provide them with a sworn affidavit, then they would approach me to do so. I have not yet been approached by them to make such a sworn statement. So that is the current state of play. I think, again, it is in the hands of the Hawks and the Police Services to engage me. I am more than willing and ready to assist them in their investigations.

Chairperson: One second, Hon Mente. Mr De Ruyter, are you indicating that since this matter was brought to the attention of SSA, Hawks, in or around June/July 2022, you would have not had the opportunity to interact with them or they have not interacted with you since? Because the question then becomes are there case numbers when you reported this, or you solely rely on the Section 34 reporting?

Mr De Ruyter: No, I have not, because of the general nature… Sorry, Hon Chair?

Chairperson: Yes, proceed, “because of the general nature”…?

Mr De Ruyter: Of the criminal activity and the fact that there is organised crime that we suspect, I suspect, is involved in this, it is very difficult to do what is typically the case with a single criminal instance where you can say, you suspect that Mr X stole even tonnes of coal from power station Y on such and such a date; that is not the nature of the information that is provided. The information that is provided is of a nature that illustrates that there is, as I said, at least four syndicates operating in Mpumalanga, at Eskom power stations. And they are engaged allegedly, and I think we have got very good reason to suspect that it is true, in various criminal activities. And this pattern of criminal activities has been reported. You will understand that to report a specific crime you first have evidence that such a crime is committed, but when an organisation has been so penetrated by criminals as Eskom, it is really the job of law enforcement to establish the extent of the racketeering that is involved, and this is done by means of the gathering of crime intelligence and by ensuring that appropriate preventative steps can be taken. Again to emphasise, I have engaged with the police on the very highest level and the investigation as I understand it, is not focusing on isolated incidents because then the people who are brought to book will be the so-called runners, the lower level individuals who are not the people behind the crimes. And that is why as far as I understand, this is being looked at as a racketeering investigations, as contemplated by PRECCA.

Chairperson: Hon Mente, you can proceed.

Ms Mente: This is now very interesting, because you call law enforcement and any other body to kind, for a lack of a better word, whistleblowing and you are not asked for a statement, but they kickstart an investigation and arrest people. I am beginning to wonder who the main complainant is. Do you perhaps know if the state is the main complainant (and) through who? Who are the main witnesses that have provided sworn statements? Perhaps, in Eskom, are there any other senior officials that have provided sworn statements to that effect of you blowing the whistle?

Mr De Ruyter: Hon Chair, I am not an expert on criminal law. But as far as I understand, the South African Police Services are not only required to investigate or are not limited to investigation, once they have received a complaint. They also can proactively gather intelligence information to prevent crime and to ensure that they can conduct investigations. As I have stated before, my legal team have complied on my behalf with my Section 34 with PRECCA obligations. And my focus has been on – or had been rather, on managing Eskom. And I certainly did not see it as my job to intervene or interfere in policing activities; I leave that to the National Police Commissioner. And he, no doubt, very capable staff to ensure that we can investigate these activities adequately. Thank you.

Mr Mente: That is exactly it, Mr De Ruyter. You are managing the biggest entity of this country. You blow a whistle, you congregate law enforcement bodies, you report to them, then you do not follow up because it is none of your business? How are you running a business wherein money is flowing out? And not flowing out in a manner in which is designed by law, it is flowing out and you know, through your suspicions and some other ways that you have established that it is a fact that monies being stolen through procurement. But then you have no interest of knowing how far are the cases, you have no interest of knowing who else has been interviewed. It is very interesting. You are saying ever since you called and met with the law enforcement on the 4th of June 2022, to make them aware of any corruption that you have picked up in the entity, you have never followed up with the law enforcement since then, until the SONA (State of the Nation Address) speech? Is that what you are saying?

Mr De Ruyter: No, that is not what I am saying, Hon Mente. I think what I am saying is that according to my understanding the investigations are ongoing; that I have been cooperating and that I am prepared to cooperate fully with law enforcement in this regard. In my previous appearances at SCOPA, you may recall that we continuously reported as Eskom, that there had been a number of cases that had been lodged with various police stations throughout the country. And we were, I think, fairly frank, in sharing with the Committee, the fact that we had little success in ensuring that these cases were fully investigated, and that they were adequately followed up and eventually prosecuted. And this is one of the major issues that I think needs to be addressed is the efficiency of the entire criminal justice system, in order to ensure that individuals who engage in criminal activity anywhere, but in particular, in this instance, at Eskom, that they are apprehended and that they can be successfully prosecuted and that the necessary punishment should be meted out to them. So, again, it is not my job to follow up with the police. That is the job of the National Police Commissioner. And I have consistently and continuously engaged with senior police officials and I have made available information that I have got, but it is not my job to – and it was not my job as Chief Executive of Eskom to do the work of the police. That was never my intention. Thank you.

Ms Mente: That is why we are sitting in the darkness. You allowed criminality to continue with impunity. You cannot report a case and then not follow it up, then wait for social media and any other public platform to inform you if there is any progress in the investigation that you have started. Now, Mr De Ruyter, I want to check with you if you believe in accountability. And by the time you were leading Eskom, you were willing and complying with the laws that were guiding you and governing Eskom and your position. Now, tell us, did you comply, at any point with the illegal and unlawful instructions given to you by this so-called senior manager or senior politician? And at the time, they gave you those unlawful instructions, why did you not report to Parliament that ‘I am being given unlawful instructions, thus making my job difficult in uprooting corruption and building Eskom properly’?

Chairperson: Mr De Ruyter?

Mr De Ruyter: Hon Chair, I seem to have the lost visuals.

Chairperson: We can hear you. You can proceed. The technical guys will have a look at… Oh, alright. There we go.

Mr De Ruyter: Alright. Okay. I did not manage to catch all Hon Mente’s question, but I will try and respond to the gist of what I think Hon Mente said.

Chairperson: Let her put it to you again. Hon Mente, if you can round it up, then we will come back.

Ms Mente: Mr De Ruyter, if you believe in accountability and you respected all the laws that are governing Eskom, which were governing you during your tenure. By the time you were given these unlawful and illegal instructions, did you comply with them? And why did you not report to Parliament that there are politicians or senior officials that are forcing you or your officials to comply with unlawful instructions, thus giving away to corruption and killing Eskom, hence we are sitting in the dark? Why did you not report that to Parliament at the time?

Mr De Ruyter: Hon Mente, I think that there may be a misapprehension here in your question. Clearly, I do believe in accountability. And I think that everything that I have done hopefully has contributed to demonstrating that. I never made the allegation that I received any unlawful instructions. That is not how the organised crime is perpetrated. There is not a directive that comes from a senior politician to Eskom that says you have to facilitate the theft of money or the diversion of funds in an unlawful manner. The way that the organised crime works is that there is a network of people, some of them, regrettably, Eskom employees who collude with criminals to ensure that through fraudulent activity they can extract money from Eskom and do so, to my knowledge, not because of any instruction that emanates from Eskom’s senior management. And I am certainly not aware of any such instruction being given to Eskom management, and I certainly never gave such an instruction. So I think, with respect, there is a misconstruction in your question that links the political oversight of Eskom with the criminal activity that goes on. There may or may not be such a link but that link is not executed through the Eskom management structures.

Ms Mente: The last one, Chair. If then that was not an instruction to you or to your senior managers, how did you establish that there is an involvement of a senior person and why was that reported to Parliament in all structures that are appropriating the funds which were stolen in Eskom under your guide?

Mr De Ruyter: Again, Hon Mente, this matter was reported to law enforcement and these matters are now, to my knowledge, under investigation. So, again, those questions are based directed at the DPCI and at the South African Police Services because I am not privy to progress on those investigations and even if I were, I would be loath to disclose detail that may compromise progress with those investigations.

Chairperson: Alright. I think case numbers here are of critical importance. Colleagues, I am advised there is a request for a ten minute break by Mr De Ruyter. We will take the 10 minute break, and we will come back sharply at 11:15. Thank you.

The Committee took a 10 minute adjournment.

Chairperson: We will start with Hon Lees now, Mr De Ruyter. I do not have a deputy.

Mr A Lees (DA): Good morning, Mr De Ruyter. Thank you for joining us this morning. A lot has been asked already and so I am going to try not to go over the same ground again. Just, at the outset, you have experienced an attempt on your life through poisoned coffee. Have you had any recent threats to your life or to your family and close ones, particularly since you agreed to come and appear before SCOPA?

Mr De Ruyter: No, fortunately no threat has been made directly to me. That is something to be grateful for. Thank you.

Mr Lees: Indeed, it is. Thank you very much. During your time as CEO or Group CEO, you made the point that Eskom would revert to using OEMs (original equipment manufacturer) for maintenance in order to get the maintenance done efficiently and correctly. Was that implemented?

Mr De Ruyter: Hon Lees, yes, Eskom did receive approval from Treasury finally – I think that took place in April 2022 – to buy directly from the original equipment manufacturers. And that did enable Eskom to perform maintenance in a better way, by using the original equipment manufacturers, spares and also their expertise. What did take place, however, was that in some instances, this was being undermined by various individuals at power stations, where, I think I alluded to this in my submission, in spite of the fact that a contract had been put in place, that inquiries would still go out to middlemen in an attempt to continue with the extraction of funds and that was, at the time that I left, an ongoing effort to try and ensure that this abuse did not take place. But this is an example of the type of resistance to ensuring that proper maintenance is performed.

Mr Lees: Thank you. In your TV interview, you made various allegations regarding the Hitachi tenders for the boilers and the design faults. Minister Ramokgopa has disputed your claims that there was corruption involved in the awarding of the tender to the consortium of Chancellor House/Hitachi, for the boilers. In what way were the designs manipulated? Were they manipulated to ensure that the designs could only be matched by Hitachi? And did this mean that essentially, Hitachi could name their price?

Mr De Ruyter: Hon Lees, the sequence of events relating to the award of the boiler contract is, I think, fairly well ventilated in a sworn affidavit that I deposed incidentally, on my final day as Chief Executive, in response to a court case brought by the United Democratic Movement and others to end loads shedding. In brief, what I said in that statement was that a letter of award had been issued to another company – Alstom. That letter of reward was rescinded. There is a trail of evidence that suggests that it was rescinded due to influence that was exerted by the Board and people close to the Board. Chancellor House, which is an investment arm of a political party, bought 25% of the shares in the local Hitachi subsidiary if memory serves, for an amount R1.2 million. This was subsequently sold for an amount of R98 million. The design of the boiler specification for Alstom was adjusted to reflect that the boiler height was inappropriately low. A similar design modification was not made to my knowledge to the Hitachi boiler design. And therefore, when the tender that was awarded to Alstom was rescinded and subsequently awarded to Hitachi – the Hitachi/Chancellor House joint venture – that then did not take into account these modifications. It is my view that a significant amount of design defects arose during the design and adjudication of the designs submitted by Hitachi at that time.

With regard to whether or not the transaction was corrupt – I can only refer to a settlement that was paid by Hitachi to the United States Securities and Exchange Commission (SEC). They paid a fine of $90 million, which is about R400 million at today's exchange rate. In its submission to the SEC, the Department of Justice at the time, said that Hitachi knew that their partner was an entity with political influence. So I think one can draw one's own conclusions from the language of that statement and from the fact that such a fine was paid. Unfortunately, this matter was never fully investigated in South Africa. So that remains one of those question marks that will probably remain over Eskom for a time to come.

Mr Lees: Thank you. You referred there to the Board; let us just talk about the board a little bit. The current Board Chair in early March indicated and stated that “Eskom is rooting out fraud and corruption within its ranks and supply chain through proactively implementing recommendations” and here is the key “made by the Zondo Commission and beyond.” So the actual performance in implementing Zondo Commission recommendations, I think is fairly well known to be very limited, particularly in this Parliamentary sphere, but I think also in the Eskom sphere. The previous Board, bar for one Board member, was post-haste replaced by Minister Gordhan with a new Board after the confrontation between Busi Mavuso in a SCOPA meeting. Ms Mavuso, correctly in the eyes of many South Africans, put the blame of the Eskom woes squarely on the ANC. What was your relationship like with the Makgoba Board? Did that Board provide you with the support for the action needed to root out fraud and corruption at Eskom?

Mr De Ruyter: Hon Lees, I enjoyed a positive relationship with the Board chaired by the Interim Chair, Prof Makgoba. I was of the view that they held management, the executive, including myself, to account, in a critically constructive way. It was certainly not plain sailing. I think their activities and their work were limited by a lack of capacity; as you know, there were a number of vacancies on the Board that were not filled for a number of years. That gave rise to key committees being severely depleted of Board members to participate in deliberations and make decisions. Quorum was typically difficult to establish for that reason. But all in all, I think that the Makgoba Board understood the principles of corporate governance and understood the role of a non-Executive Board providing oversight, and acting accordingly. Thank you.

Mr Lees: Thank you. When the new Board was established and you worked with them for a few months, was the relationship similarly positive between you and the new Board? And did they provide support or is the opposite true?

Mr De Ruyter: I think that support was provided. You may be aware of the fact that Eskom has a structured process in place to ensure that the recommendations of the Zondo Committee are identified and followed. This was put in place prior to the accession of the new Board. And that process continued. And I assume that it still continues to this day, in order to ensure that those who have been identified in the Zondo Report can be held accountable to the extent that that is legally possible. The new Board, I think, has adopted a markedly different approach. It has become a self-styled, engaged Board or activist Board and has immersed itself in operational detail, which some would characterise as overreach for a non-Executive Board. But, I am happy to leave that to my successor to manage, in order to ensure that there is adequate separation between non-Executive Board members and the Executive and Management – so that the lines are drawn in terms of good corporate governance.

Mr Lees: So that overreach by that Board, did that play a role in your decision to leave Eskom?

Mr De Ruyter: Yes, it did. It certainly made my life quite challenging. Meetings were held with subordinates of subordinates of subordinates of mine, without my knowledge and instructions were given. This did make my life difficult and I experienced that as disempowering. I know certain of my colleagues on the Executive Committee had similar experiences. I would direct you to also engage with them to the extent that this is something that you wish to investigate further. But I think that the Executive are the people who should run the company and they should be held to account by the oversight of the Board and this is certainly the advice that we have received also from the top corporate governance experts in South Africa. So yes, the engaged Board did play a role in my finding my position to…

Mr Lees: Just to build on that. So we have a Board of Eskom, which exercises what you would term ‘overreach’. In your TV interview, you mentioned that the Department of Public Enterprises played a very interventionist role in Eskom, micromanaging Eskom. So would it be true to say that the department, you are referring to Minister Gordhan there?

Mr De Ruyter: Hon Lees, yes, I think Minister Gordhan is known for a style that can be characterised as being extremely involved in operational detail, down to individual power station units, down to speaking to middle ranking officials in the organisation, bypassing myself, my Chief Operating Officer, the Head of Generation and so forth. So, yes, there were examples of intervention in the day to day operations; whether that was to gain information or to verify information, I do not know. But it made life as the responsible accounting officer quite difficult. Many different cooks in the kitchen does not always result in a good meal.

Mr Lees: Thank you, Sir. Let us just stick with Minister Gordhan for a minute. You, during the course of this morning, have repeatedly referred to reports to the shareholder representative, Mr Gordhan. And so it has become patently evident to me certainly, that the Minister who made the comments about letting other cadres or certain people feed was indeed, Minister Gordhan. Now, the question is the identity of this senior political figure – I forget the exact words that you used in the interview. That person obviously is known to you otherwise, you would not make such a statement. And in due course, that name will come out. But obviously, Minister Gordhan knows that name, as well, I would suggest. Is that true?

Mr De Ruyter: Hon Lees, that is a question best directed at Minister Gordhan. I am not sure if he has that knowledge, but I would say that you direct that at him.

Mr Lees: Thank you.

Chairperson: Just one second. No, Mr De Ruyter, I think whilst there are, you know, the issues you have raised. Some of these questions are pretty straightforward. If you knew the person and your reported the person, all Hon Lees is asking, did you close that to the Minister, and therefore is Minister Gordhan in a position to know who it is? Yeah, so it is a very simple… Yeah, let us just answer the questions. Some of them are really yes or no responses. And I think Hon Lees’ question, again, is very fair and direct. He is not asking you to disclose because you have made it patently clear that you will not. But, his question remains fundamentally fair.

Mr De Ruyter: Right. Thank you, Hon Chair, and thank you Hon Minister… Hon Lees. Yeah, I think…

Mr Lees: Prepare yourself for 2024.

Mr De Ruyter: Alright, I shall refrain from saying anything in that regard. Yes, I think that is a question that will be able to be answered by Minister Gordhan – he should be able to answer that question. To my recollection, I did mention it to him. He would be best placed to answer that.

Mr Lees: Okay. Mr De Ruyter, the whole question of cartels, the top guy in the cartels – what is his name? I cannot remember his name. Nevertheless, you make reference to a scheme of arrangement for very expensive motorcars. And earlier, you mentioned posts on Facebook and so on. And you mentioned dealerships that house cars, ostensibly owned by the dealer, but actually already paid cash for by the criminals – the cartel members. Which motor dealership is involved in this? I asked you at the beginning whether you have experienced any further threats on your life and I would think that this might be a source of a threat, if there was one. If you are able to say that there was such a scheme and dealership involved, who was that dealer or those dealers? Are there more than 1?

Mr De Ruyter: Hon Lees, let me first say that this is a very good example of how lifestyle audits can be circumvented. If transactions are done in cash, and assets are acquired but not registered to your name or assets, such as cattle, for example, are delivered to farms in lieu of payment, then the typical lifestyle audit will not pick it up. So the individuals concerned have become very skilled at circumventing the rigour of lifestyle audits that typically focus on bank accounts, cars registered in your name, properties that you own and so forth. This is one of the reasons why lifestyle audits have limited efficiency in picking up some of these issues that we have to guard against. On legal advice, Hon Lees, I am advised that I should not disclose the identity of this motor dealer for: a, reasons of ongoing investigation, b, civil as well as criminal issues that may arise from it. And therefore, I can merely confirm that I was made aware of the existence and the operation of such a dealer, and that this is taking place in Mpumalanga. Unfortunately, that is the extent to which I am able to go based on my legal advice.

Mr Lees: Alright, Mr De Ruyter. Yeah, I assume that those names will come out in due course. What we have done as we picked up one video, which we believe is part of that cartel and we have indeed done a search of the background and identified a motor dealership. But in due course, I suppose, this will come on, but it makes it very difficult for us to make progress. But let me move on to our newly appointed Minister of Electricity, and ask your opinion of a statement that he has made. While addressing media at Kusile – so I assume that he was referring to Kusile and not to Eskom as a whole, but it came across as if it was Eskom as a whole – he stated that, and I quote, ‘The challenges that we have had here, these are technical problems, they have nothing to do with so-called corruption.” And then again at Duvha, “The source of the problem is at the mine”, I assume that it is a coal mine, “it has nothing to do with someone diverting coal and then mixing with rocks.” Is Minister Ramokgopa misrepresenting the facts, or in plain language is he simply lying?

Mr De Ruyter: Hon Lees, I do not want to characterise the Minister as lying. I think that I can make a number of remarks that present a different perspective. And then I will leave it to the Committee to arrive at its conclusions. I find myself in the rather unusual position of fully concurring with the Regional President of the National Union of Mineworkers, who said that ‘As the NUM Highveld Region, we are categorically and emphatically disagreeing with the Minister's version that corruption at Eskom does not play any role towards persistent load shedding. And I think that is quite clear – NUM have gone on record with this. I think that Solidarity have also made statements to that effect. If you look at the situation pertaining to Kusile, first of all, if the boilers had been appropriately designed, then the issue of a higher exhaust gas velocity, which caused the carryover of ash and gypsum into the duct that eventually collapsed, leading to the outage of three units, would not have taken place. And I earlier expressed, or I gave some background to the Committee on the supplier of those boilers and how that particular design came about. In my mind it is also quite clear that if one buys coal with higher ash content, specifically, if that ash content exceeds the capacity of the fabric air filters to trap any particulate matter, then they will be carried over into the duct. I think this Committee is very well aware of the fact that for a number of reasons the construction of the New Largo mine has been delayed. We can maybe speculate on the reasons that has happened. There have been significant issues with coal quality at Kusile, and that coal quality has been a significant contributing factor to the ash carryover, which eventually resulted in the collapse of the duct. So I think there is at least evidence that suggests that corruption does have an impact on load shedding, and particularly corruption in the coal supply chain played a contributing role to the collapse of the duct at Kusile and the loss of the 2000-odd megawatts, as a result of those units being rendered inoperable.

Mr Lees: Can I just build a little bit on that – the point that you made about New Largo? The delays in opening up that mine to supply Kusile, I would understand from your presentation, that could well be the result of the criminal cartels wishing to keep the road transport activities going and with road transport, of course, the supply of subgrade coal and rock. Would you agree with that view?

Mr De Ruyter: Hon Lees, I think with any question of this nature, the departing principle should be to ask who benefits and clearly the people who have benefited from a delay in the opening up of New Largo. And just to refresh the Committee's memory, Kusile was built where it is because of its proximity to New Largo where there are significant coal reserves of quality that is suitable for combustion at the Kusile Power Station. So the delay in commissioning New Largo mine, I think, can in all probability be attributed to the fact that there were beneficiaries of coal being transported by road. And that the quality of coal, I think there is ample evidence that the quality of coal that was delivered to Kusile was below standard, and that Kusile was significantly exposed to the consequences of poor quality coal being delivered, in terms of the reliability of its mills, its air emission compliance, the ash content of the coal, steel, rocks, water, and so forth, being added to the coal. At the time that I left there was a significant effort on the go, initiated by myself, to improve the functioning of the coal stockyard at Kusile, to ensure that we could exercise better control over coal arriving there; and hopefully that will go some way towards addressing that.

Mr Lees: That being the case then; the development of the New Largo. A major, major investment not controlled by officials within a particular power station, would seem to indicate that if the cartels were successful in delaying the development, it would need more than just Eskom officials within their reach to cooperate and take the necessary action for the delays, which are now 10-odd years – it is mass delays, it is not months – to have taken place. Would you agree?

Mr De Ruyter: Hon Lees, it certainly seems that way, that there was some degree of collusion or complicity in taking those decisions to delay the construction and development of New Largo colliery with a view to continuing to benefit contractors who deliver coal by road, thereby possibly incidentally, but possibly also intentionally, contributing to the delivery of poor quality coal to the power station, and as I have just mentioned, the attendant failures that occurred.

Mr Lees: Thank you. So what this is leading me to conclude is your comments during the interview about this very senior politician, presumably resident in Mpumalanga, who is involved in the cartels. And we know that the name that is being thrown out there by various people, as a possibility of being this person, is the previous Deputy President. And so one would then have someone who has a lot of influence and possibly to delay even the development of a coal mine. So Mr Chairman, thank you for the time. I will cede until my next turn, even though I am Deputy Chair.

Chairperson: This thing of Deputy Chair – this palace coup that you want. Alright, Hon Somyo, let us get right to you, because I am mindful of time. Over to you.

Mr S Somyo (ANC): Well, thank you very much, Hon Chair and Hon Members and the former CEO of Eskom, Mr De Ruyter. Thanks very much, Chair, as you have indicated, for your availability here today. Mr De Ruyter, as the CEO of Eskom, have you ever ventured into the appointment of a private intelligence operation for investigative exercise within Eskom?

Mr De Ruyter: The appointment of a private intelligence organisation was not done by Eskom. It was not done by using Eskom funds, so no public funds were expended and Eskom was not the client or beneficiary of such an appointment, and I was not aware of any contract or the terms of those contracts – I was aware of a contract but not the terms of the contract that had been concluded.

Mr Somyo: Mr De Ruyter, have you been party into the appointment of (a) private investigation, which you have referred to, in terms of your report?

Mr De Ruyter: Because of the significant risk posed to Eskom, as a result of criminal activity, it became clear that Eskom required some form of intelligence gathering capabilities. And this, I think can be attributed to the fact that as the owner of a number of national key points, we were charged with the obligation to protect those national key points, and to ensure that we took all steps necessary to secure the safety of those national key points. We therefore approached funders with a view to seeing if assistance could be obtained, again, not using any Eskom money, not going through Eskom’s contracting party. And in this particular instance, again, this was encouraged by the political principles involved with a view to ensuring that we could secure our assets from criminals targeting those operations.

Mr Somyo: Thank you very much, Mr De Ruyter. Now I understand that indeed you are aware of that investigation. The outcome of that investigation, as you have indicated, was shared with a number of state-related criminal investigation authorities at about (the) middle of the year, 2022. Substantively, what are the key areas which are identified by that report?

Mr De Ruyter: The report was shared with law enforcement and they undertook a number of steps, I think, again as a result of intelligence. Again, I can quote what President Cyril Ramaphosa said in his SONA brief at the beginning of the year in 2023, where he said that an intelligence-led operation that led to 43 arrests at Eskom installations. It also led to the deployment of soldiers at 4 Eskom Power Stations on the 16th of December of last year. It led to 4 black sites being raided by the Hawks. I understand a further 30 of these sites are still under investigation. I understand that the special investigative team has been established by the South African Police Services and that a number of changes have been made to police management in Mpumalanga and that more resources have been deployed as a consequence of the intelligence that was shared with law enforcement that flowed from this particular investigation.

Mr Somyo: Who funded this investigation?

Mr De Ruyter: This investigation was funded privately by private donors and they were also the contracting party. So, again, Eskom was not a party to the contract involved.

Mr Somyo: As part of your good intention, you had to approach some of those individual bodies for funding after you have identified those areas which you have indicated earlier on, that there is a huge risk which needs some form of certainty so that it should be followed appropriately. And therefore, you saw it fit that you would approach people who have an interest or institutions that have interest in terms of funding that initiative. So who ultimately made funds available for that investigation?

Mr De Ruyter: The funds were made available, as I said, by private donors as Eskom was not a party to any of the agreements, as no public funds were involved. I would suggest that the identity of those donors should remain within their purview. Again, I would not wish to interfere in any ongoing criminal or legal investigation, nor would I wish to expose anyone who attempted to support the combating of crime in a good faith manner to the sort of risk that I myself and other members of my Executive have faced in order to protect their identity. I think it is up to those individuals to decide whether or not they wish to disclose. Again, since no public funds were involved in this, respectfully, I suggest that this is outside of the SCOPA purview.

Mr Somyo: The interesting part to it, Mr De Ruyter, the findings of the report fall in line with our visit as SCOPA, to your offices sometime (or) at the same time, with the release of this kind of report. When a member of your Board became erratic, in a way, which seemingly, would you confirm that there was a Board member who assisted you to get funds for that potential investigation?

Mr De Ruyter: Again, Hon Member, bearing in mind that we are dealing with the potential organised crime and the fact that people's lives are at risk, with respect, I would rather not confirm or deny that there was a Board member who was involved in enabling the funding of such an investigation to take place.

Mr Somyo: Mr De Ruyter, in the same vein, on the strength of the report, there is a categorisation of what is termed ‘cartels’, which you have referred to in your report. That strength of the outcome of the investigations that you are aware of, that you have been primarily involved for them to be undertaken, then the outcome would have been a note which recognises the existence of these cartels?

Mr De Ruyter: Again, if I understand your question correctly, Hon Member, we ensured that this information would be conveyed to the South African Police Services. I have mentioned some of the examples of successes that, in my opinion, can be directly attributed to this intelligence gathering exercise. And I therefore think that information that was provided to the South African Police Services was in fact acted on and led to a number of successes that would otherwise, in all probability, not have been achieved if that information had not been obtained and shared with law enforcement.

Mr Somyo: Well, the same report, which you have told us about, is the same report which gives you some information in relation to who is allegedly participating in these kinds of cartels, wherein you have the strength to make those allegations publicly in the interviews: is that the case?

Mr De Ruyter: Hon Member, yes, I think that certainly there were investigations that were done that brought about allegations that we have the potential that or the alleged involvement of senior officials in crime in Mpumalanga – I think that much is now quite clear. And we have to now let the law enforcement investigations take their course. I think it is important that we are able to give the police the freedom to conduct the investigation without having to combat the public availability of information which could compromise those investigations and potentially defeat the purpose of the outcome. Hon Chair, while I have got the microphone, I unfortunately have a commitment that I cannot get out of, as per the agreement reached with SCOPA prior to this meeting. I have given the three hours that had been agreed on. I understand that the Members would probably wish to continue with the session but unfortunately, as I communicated prior to accepting this appointment, I am regrettably unable to continue. With your permission and with due respect, I would like to excuse myself at this stage.

Chairperson: Yeah, Mr De Ruyter, I was going to say let us allow Hon Somyo to conclude – he is concluding now. That 10 minute break makes a huge difference. So Hon Somyo will conclude – he is concluding. He indicates that he is wrapping up.

Mr Somyo: No, no, if you allow, Chair, I have a list of other questions, which I think are critical. But I want to, taking what Hon Lees has referred to, and in terms of the response provided by Mr De Ruyter, that he was somewhat rocked with his relationship with the new Board. And there was a causal factor which has somewhat driven him out of Eskom. Can one conclude that at the same time, it did arise that Mr De Ruyter was not effectively vetted as accounting officer of Eskom? That might be as well a contributing factor when that fact was exposed. He has been acting on a huge responsibility which exposed Eskom’s finances and decisions, and all the time, the operator is not necessarily vetted as required in terms of his responsibility. That fact as well would have been a crucial moment for him to want to leave Eskom, because that exposure was a big exposure for an individual like himself, not to have effected a vetting exercise. Thank you, Chair.

Chairperson: Let us get the response. I just want to make one comment and then we will release Mr De Ruyter. Would like to respond to that, Mr De Ruyter?

Mr De Ruyter: Hon Chair, I think the matter of my vetting was extensively ventilated during the last SCOPA meeting that I attended. The request for vetting was only made by SSA to me in October 2022. And of course, with my decision to resign, which I made known to the Board on the 12th of December, that vetting process became moot. So that was not pursued. And I think as I have indicated, having served three years, more than three years at Eskom, this is something of a record in terms of lasting at the helm of Eskom. So I do think that resigning when I did, particularly having regard to the circumstances prevailing at the time, I had adequate reason to do so. Thank you.

Chairperson: Thank you very much. Colleagues, I think what we will do is… Let me put it this way, Mr De Ruyter, thank you very much for appearing. It is certainly not the last time we will be engaging. I think we will meet again, because some of the issues have not been adequately ventilated. And you have given, in part, certain pointers, in part, there are answers which are still inconclusive moving forward, and so, those need to be dealt with. So, I think colleagues, we, for this part, we can leave it at that and say we will meet again, in due course. I do believe that what you have given us today is what you gave in the interview. And so, we, for all intents and purposes, (are) 99.9% literally at square one. And so, we will have to prove these issues further. But thank you very much for appearing this morning. And as I said, we will meet again. So, thank you very much, Mr De Ruyter.

Colleagues, we will break and return at 13:00, so that we can then make a determination in terms of what it is that is the next action step, then for us. And then you can take some time to bring it all together, and then we will meet, we will reconvene at 13:00. And I am sure that we will be done by 14:00 to map up a way forward. There was a proposal before we arrived at this meeting on the key question of a Committee Inquiry into Eskom. And we had said we would want to hear what Mr De Ruyter has to say, insofar as the issues around the interview are concerned. And so now we need to take a decision in terms of how we proceed with this. Obviously, there are officials and persons who have been named, who must provide responses to some of the key critical areas to it, including the Board, because I am still not clarified in terms of the reporting to the SAPS and the due processes that followed after that, in terms of cases. The SIU (Special Investigating has reported on some of these issues, but not to the extent to which they seemingly were reported. And there is political accountability that has to take place. So as I am saying the answers remain largely unanswered. And they have to be answered. So I think we will meet. But once again, Mr De Ruyter, if you are still online, I thank you very much. Colleagues, we will reconvene at 13:00 and we will take our break at the Marks restaurant building as usual: 13:00.

The Committee adjourned for a lunch break until 13:00.

Chairperson: Colleagues, we have received the submission by Mr De Ruyter. We have heard what he said after we fielded questions. Albeit, some of the answers have not been forthcoming, but we had wanted to have this process to help us guide how we move forward. And of course, there are already markers ready in terms of certain persons who must be called. So I am going to hand over to you colleagues for your ideas and then we structure the cause of action moving forward. Hon Hadebe, Hon van Minnen?

Mr Hadebe: Thanks, Chair. Do we have legal present?

Chairperson: Fatima should be online?

Mr Hadebe: Is she still?

Chairperson: Fatima, are you still there?

Ms Fatima Ebrahim (Parliamentary Legal Advisor): I am here, Chair. Yes, I am.

Chairperson: Alright, here she is.

Mr Hadebe: Chair, I am asking on the basis that we decided that first and foremost, we need to have information at our disposal in order for us to determine the next course of action. We have received a submission from Mr De Ruyter, even though initially we had requested a sworn affidavit. I would like just to get clarity whether or not we can utilise the submission provided to SCOPA as our basis to continue with the next course of action, if the legal team can assist us? How binding or relevant or useful are those submissions? Bearing in mind that ours was to request a sworn affidavit, which will have all the relevant authority for us to take it forward in relation of summoning or inviting other affected or mentioned parties within such a document. That would be my first question, Chair. And then I would be able to propose the way forward.

Chairperson: Fatima, over to you.

Ms Ebrahim: Thank you, Chairperson. Chair, the affidavit or it was meant to be an affidavit at least, was not in the form of a sworn statement. Mr De Ruyter did, however, confirm that the statement is his statement. And I certainly do not see that there would be any problems with us proceeding on the basis of that information that is in that statement.

Mr Hadebe: No, thank you so much. I will then, Chair, propose that I think let us invoke the relevant clause in the Constitution and in the National Assembly rules to summon Mr De Ruyter to give further information. But prior to that, let us also invite all the affected parties as previously agreed in our meeting to further shed light, and on all those that will have been affected in terms of their names appearing in current submissions to further shed light, as it was earlier on articulated and it became clear that for this Committee to get more relevant information pertaining to the misappropriation and mismanagement of taxpayers’ money, there are relevant authorities are currently investigating. So I will propose that once we have concluded interaction with those mentioned stakeholders, first being the Hawks, the advisor to the President, the Hon Minister Mr Pravin Gordhan – he was also mentioned several times – and we have already indicated previously, that we would want to ask the Board, also, to appear before us, to also shed light in terms of the information that is at their disposal; forensic reports that were summoned or sanctioned by the former Group Chief Executive. What is the status of the report? If it is one or many, what are the statuses of those reports? So we can just gather that information. And once we have all that information, then we will determine the next course of action. So basically, what this exercise of this morning did, it gave us little information. So we still have to dig further for us to be able to arrive at the exact action, whether or not we go for full blown inquiry, or what we have gathered as fact finding will be sufficient enough for the relevant authorities to act on the misappropriation of taxpayers’ money. Thank you.

Chairperson: Hon van Minnen?

Ms van Minnen: Thank you very much, Chair. I think what is very clear from this morning is we do need to have a further engagement with Mr De Ruyter. But at the same time, I think it is very, very clear that we have missed an opportunity as Parliament to have a proper Parliamentary investigation. So going forward from SCOPA, I would really suggest and I would concur with the Hon Hadebe, we need to have the relevant ministers called or if not called, summons to SCOPA, including the Hon Gordhan. In addition, Mr Sydney Mufumadi, I think, is somebody who could also give us information. What does concern me is that Mr De Ruyter was indicating that the criminal investigations had to very largely be driven by Eskom rather than coming from, you know, the Shareholder Minister. And I think that that is very concerning. So I also think we need to talk to the police and the investigative services – the Hawks were mentioned, and possibly also the SIU, as we all know they have done a great deal of work here. The name of the Police Commissioners came up. So I think we need to have quite a broad approach to gathering as much information as we can. If not to uncover the actual allegations that may or may not then interfere with the investigation, but to certainly, as SCOPA, get an idea of what is going on and whether or not this has actually been driven or whether it is going to be allowed to just fade away, because I think it is very important that action comes from this; and it is just not another meeting where ultimately nothing comes from it. So I think SCOPA needs to perform its functions vigorously here, and still meet with those role players, and then from there decide where to go. Thank you.

Chairperson: Hon Mente? She is sleeping at the back. Hon Mente?

Ms Mente: Who is sleeping? Yeah, Chair, to add on the way forward, and in particular, that of inviting law enforcement, because law enforcement has been used as a kind of escape goat, that ‘I have sent everything to law enforcement.’ And they should have, by now, furnished Parliament with progress reports into the investigation of Eskom, which I have never heard of. And I have never, not even from the Police Portfolio Committee or SOEs (State-Owned Entities) Committee, we have never heard that the police is coming to present progress in terms of the investigations on corruption in Eskom. That one has to be done as soon as possible. And we ought to be very wary of our actions going there because we have experience where Mr De Ruyter would come to this Committee and say people could not be vetted, SSA is delaying, blah blah. In the meantime, when the SSA came here, it said that De Ruyter was refusing to give the statements. And the worst part of it is that we are approaching a year since he had approached the law enforcement agencies. And to this point, he has never submitted a sworn statement of his own, to anyone pertaining to the information which he discovered himself or any other facts that he can talk to as Group CE (Chief Executive). But on top of that, especially when it comes to the information on cartels, there is a system which National Treasury is supposed to be looking into. And the system allowed – there is something called “free tax” that was mentioned there. And that “free tax” looks like a new system where people can get procurement successfully, whether inflated, whether it even meets the standard which is required. There is something going on with that “free tax”. Treasury has to come and explain and unpack to us what is “free tax” because it looks like there is a new angle now that the thieves are using in Eskom to steal. So we need Treasury to come and explain to us; and how are they having it through the SAP system. We cannot have such a system because it goes unmonitored in that way. If anything that is in that report goes by – means there is a lot that is going through the “free tax”. The last one is the issue of coal and the pricing and the trucks and the belts and everything. I am not sure how we are going to handle that. Maybe we will have to deal with it during the investigation, as Hon Hadebe has suggested, that we need to invoke now, a mechanism that is going to give us a full swing. However, we need also clarity there because if the belt can be sabotaged to allow trucks; whose trucks are these? And the security companies, who are the owners of these security companies that are allowing trucks to come with rocks instead of coal. So, those elements, Chair, before we go into a full swing, we need to get the facts of those. Thank you, Chair.

Chairperson: Hon Hadebe?

Mr Hadebe: Thanks, Chair. Just to add, to say concurrent to what we are going to be doing as proposed. There are certain reports that cannot be divulged in front of this Committee. It is now apparent that there was an intelligence report by a private company, even though not sponsored through taxpayers’ money, but it was sanctioned or initiated by Eskom, who is a public entity. So, I would like to propose that we refer such matters to the Joint Standing Committee of Intelligence to look into such a report. And they will be in a position to ask all the relevant question(s) and find out the update as it relates to that report.

Chairperson: I think on the issue of that report, we first need to be briefed on its material constructs because I know it has been (an) intelligence report but I am not sure whether we can conclusively call it that. So I think let us get a briefing on it when Eskom comes to appear, insofar as answering questions on this one. Whilst there must be cooperation at Parliamentary Committees, at the same time, there have been matters which Mr De Ruyter indicates were reported to SSA. I am not aware that there has been any progress with those investigations, or rather an investigation on the basis of that reporting. And, of course, the perennial headache that we have here, which is a contributing factor to why there are elements of, you know, collapse in these entities, is the slow pace or absence of vetting. But let us look at that report. And I think Hon Somyo was still pursuing it. So I think the next round of interaction with Mr De Ruyter must start there, where Hon Somyo actually was, and then we will take a decision in terms of what is referred. I am sure that some things will have to go to the Portfolio Committee. But let us go through it first, and then see where it goes. Colleagues, I hear the list. There are now entities and or persons that you have listed here. Are we doing an inquiry? Are we still doing the preliminary work towards an inquiry? So that it can help structure the programme of when all of these people will be called. I would imagine that we need to send some questions in writing to Mr De Ruyter as well, in the intervening period, for clarity on some of these things. I had quite a number of issues I wanted to raise; issues around Minister Gordhan. Is it interference, is it interface or is it meddling? To what extent is that? And to gauge the lawfulness of those interactions. You have got a micromanaging Board, and so on. So there is still a lot to peel all at once. Hon van Minnen, Hon Mente – oh, Hon Somyo. Let us take Hon Somyo first.

Mr Somyo: Thank you very much, Chair. We have been listening into a number of things which came from different angles and elements that we could pull out of such a kind of interaction, which could be placed to various suggestions on individuals or entities, as listed. And I think that the point that Hon Hadebe was referring to, on the intelligence, because it is termed that way, it is termed (the) intelligence report, intelligence work. Even Mr De Ruyter’s write up refers to both Covid-related exercises and on the detail of what basically intelligence structures would somewhat do. It might, of course, be well exercised to have a reference of some of the things which have come out so far to relevant authorities. And it would be good to know whether they know anything about such kind, you see, of a decision, because the winning authority of state institutions comes at that point, you see? It is something which will need, as well, to parallel to this process, begin to look into. So the competent authority in that exercise would be the Joint Committee. And thirdly, one other angle which I think we need to pick up is that there is a need to go through what has been done today. And that would indicate some direction of what we have to do. You asked the question of (if) we are going to be having a hearing, this or that, or what. Something which I think so far, we have not had things which need some kind of cooperation, you know, and therefore, we need to inquire on some of these kinds of information. Though with strength, now we know that we need to invoke a part of a legal framework to ensure that Mr De Ruyter is reined in as far as responding to questions in the Committee and coming about in terms of a sense of authority on matters that he says; and begin to take Parliament through this Committee, and the populace through on the things which he submitted on his own submission or statement. So there one could say we can have that exercise, we invoke relevant legislation, you see for instance, to deal with that. Though to others, we really need to invite them and that invitation is still on acquiring some information, in as far as these other matters are concerned, as they are individuals cited during the interaction with Mr De Ruyter. So thank you, Chair.

Chairperson: Thank you, Hon Somyo. Hon van Minnen and Hon Mente.

Ms van Minnen: Thank you. I think we should be very wary of consigning dossiers or files to Intelligence. I think that we need to first ensure that we know exactly what it is that we are talking about. Already in this Committee, we have had conflicts over the last year and a half, regarding the scope of what the Joints investigate and what SCOPA should be investigating – we have also had legal advice on that. And I think that we should retain control of the investigation, or the hearings that we are currently running as much as possible. And I really would be very, very unhappy to see things being pushed into Intelligence when that simply means that no one is going to know what is going on. The whole point about this is that South Africans need to know what is happening at the entity and need to know what is happening in terms of developments with law enforcement so that we actually be seen to be doing something about Eskom (and) not just talking about it in some dark corners because that is how we have got to where we are today. Thank you.

Chairperson: Thank you, Hon van Minnen. Hon Mente?

Ms Mente: Okay, thank you, Chair. Chair, I think you are competent enough to sift through the matters. And number 2, out of the identified problematic areas, especially where we still need to clear some air and establish the relationship, you will be able to do that. But as things stand, with the information we have, I think an inquiry is the best platform, because an inquiry is conducted under the other legal or space, where people are kind of forced to speak the truth, to be honest, and not try to short circuit us and tell us anything they want to say. But in terms of establishing facts, the legal of Parliament should be able to tell us because this is not going to be the first inquiry of Parliament. They know what constitutes an inquiry, and on what basis. Thus, according to us, we need a strong legal base and we need a mechanism that is going to force everyone to not lie to Parliament, to give the information that the public is looking for, for everyone else to understand, why are we still in the darkness. I think it really deserves an inquiry. But anything else that we need to seek clarity of, that should not be our worry – legal should guide you. And I think in your competency, you will then come back to us to say, let us call 1,2,3,4 people to get these clarities, which will help us to build a case of an inquiry. Thank you.

Chairperson: No. Thank you very much, colleagues. So tentatively in the programme, what we have put in for next week is the Board and the Minister of Public Enterprises on issues from today. So I think maybe if we can proceed with that, and see if we can get the President's advisor to come in just on these issues clarified. So that would be Wednesday. And then on Tuesday, the 9th, we are due to have the AG and the SIU matters related to Eskom investigations. So that is already part 1, but maybe then let us add the Hawks, the NPA, the National Commissioners, so that by that time, we would have sourced all the information and got all the clarities that we need to then formulate a basis upon which how we proceed. So those are very basic questions really: ‘This was reported to you’ or rather ‘was it? If it was, what did you do about it and how far are you with it?’ It is that thing. ‘If there is an investigation in place, how far gone is it? When will it be concluded?’ So once we get that information, then we will know the parameters. But I think the issue is since June, since April, May last year, right, it is a year later that these things have surfaced. So clarity is needed. I know that in the one meeting we had with the SIU in this very room, the SIU did speak to issues around the syndicates in three streams, which are operating at this coal trucking, did indicate that an investigation along those lines, but it did not arise out of this.

So I think I was just going to propose, colleagues, that before we conclude on an inquiry to say next week Wednesday, let us get in the Board, the Minister and the Advisor. That would be Wednesday 3 May. And then Tuesday 9 May, we get the AG, the SIU, the Hawks, NPA and National Commissioner to come in. And then at that point, we will then take a decision moving forward. So I think that would be phase 1 as a response to what we have heard today. So I hope that that suffices because we need these answers, you know, because Mr De Ruyter is emphatic, who is this high-ranking official, he says go to the Minister. You see, I was thinking the implications of this are another pager. If the Presidential Adviser was briefed on this, the President then should have been informed. So you see, it has got a ripple effect. And then what happens then? So it is important that we tie down on all of it. So that is the proposal I am making, colleagues. It is a slight adjustment to the programme, but I still think it falls within what we had in any case. I want to propose that as a way forward, then we will take further decisions later. The final point is, I would imagine, that you still have questions that were unanswered or you would still want answered by Mr De Ruyter. I think let us put all of those down in writing, in preparation for the next meeting, because I do not think that today was the last time Mr De Ruyter was appearing before us. So I think let us do that as well. Is that in order? So if you can just get your questions… no, let us do this. Let us finalise questions on Tuesday, once the Minister and the Board and Advisor have appeared, because the other stuff will be administrative things that the AG and the Hawks and the Commissioner. So next week, from Wednesday, then we will get to questions on any outstanding matters, and then we will dispatch them to Mr De Ruyter. Would that be in order? Alright, let us conclude on that note, colleagues, to say that we will meet next week Wednesday at 09:00. Hon Hadebe?

Mr Hadebe: Yeah, can you please ensure that all the stakeholders that will be appearing before us or the agencies preferably physical. Please let them not make other appointment(s) on the day because we were planning to be here until 16:00 but then Mr De Ruyter decided to have other appointments at 12. So that limits us. Now we are forced to write. We are not so much in favour of writing theses.

Chairperson: Alright. Next week Wednesday 09:00 to 14:00 and then Tuesday the 9th.

Mr Hadebe: Yeah, physically.

Chairperson: 09:00 until 13:30. It is all physical meetings, colleagues. If we are not here, we will be upstairs. I know Budget Votes are starting as well, so we are going to be navigating a very difficult 6 weeks of Budget Votes, but Committees have been provided for. So where Committees are provided for we will insert them. And then the only other person who doubles up on a Portfolio Committee is Hon Bheki, so if he is debating he will let us know. But otherwise, I think all of us are here. So where Committees are applicably provided for in the programme, we will insert them as we navigate the next 6 weeks of Budget Votes. But next week, Wednesday and that Tuesday, we are good to go. Those dates are available. Hon Mente, are you speculating lifting up your hand, or are you in darkness? All right, colleagues. Thank you very much. The meeting stands adjourned.